Red Hat's gunning for Microsoft in the enterprise server market, according to Charlotte.com. And CEO Matthew Szulik predicts the Linux distributor will catch up by 2015.
He stakes his claim on what the story calls "a global shift" of businesses toward the open source software model.
Yes, open source is gaining influence. Open source code will be part of at least 80 percent of commercial software offerings by 2010, according to Gartner Research. Moreover, IDC projects that Linux-based software subscriptions will jump 17 percent per year through 2010, according to Charlotte.com. Since that's how Red Hat makes its money, the company is in a good position to grow.
However, observers quoted in the story have varying perspectives. Some say Szulik's prediction is a gutsy one, presumably because Red Hat currently holds less than 20 percent of the market. Soleil Securities analyst James Gilman notes:
I think it would be difficult. ...They would have a long way to go.
Moreover, as Charlotte.com reports:
Al Gillen, vice president of operating system environments for IDC... said Red Hat is doing a better job than Microsoft in capturing new business as it comes up for grabs. But the company has been largely unable to steal business directly from Microsoft.
On the other hand, Brendan Barnicle of Pacific Crest Securities calls Szulik's prediction "interesting," but concedes that Red Hat's CEO could be more right than wrong.
Given his recent comments on a conference call, the story says, Szulik undoubtedly likes the company's chances:
Red Hat is sitting here with $1.2 billion in the bank and an economic model that's throwing off 40-percent [growth] in sales and cash flow.... If you can find another economic model throwing off that kind of cash, then buy the company.